Through Bank of Ayudhya, the group’s Thai subsidiary, Mitsubishi will acquire the local affiliated companies of Dutch consumer credit company Home Credit in both countries in transactions it hopes to complete in 2023. Mitsubishi will get full control of the Philippine entity and a 85% stake in the Indonesian company.

Home Credit offers point-of-sales financing services that are available in stores worldwide. Store customers simply input their jobs and salaries onto a smartphone app that will be instantly assessed by Home Credit for loan eligibility. If the loan is approved, the company sends money digitally to customer’s smartphone bank account.

In the Philippines and Indonesia, Home Credit’s app has been downloaded over 20 million times.

This service – which digitises the entire loan process, from application to repayment – is seen as an effective way to reach retail customers in Southeast Asia, where the middle class continues to grow as economies expand. MUFG hopes it leads to customers making multiple transactions by having the app offer cash advances, for example.

Japanese banks have been actively strengthening their digital services in Southeast Asia. In February, Mizuho Bank announced an investment in Tonik Financial, which runs a digital bank in the Philippines. The Sumitomo Mitsui Banking Corp group offers mobile banking in Indonesia via local unit BTPN.